WiseTech Global Limited (ASX:WTC), which is up 78% in one year, is up another 6.4% at the time of writing to $11.25. At the Macquarie Conference yesterday, the company’s presentation shows a healthy outlook for FY18 earnings, with EBITDA to grow from $54 million in FY17 to $71 million to $75 million in FY18, an increase of at least 32%.
In February this year, the share price crashed 23% after the release of its half year December 2017 results, which were in line with expectations, but the share price was starting to look overbought.
WiseTech, a provider of software to the logistics industry globally, is trading on a forward price-to-earnings (PER) ratio of 77x. WiseTech looks expensive at these levels, as the outlook for earnings is good but probably does not justify such a high PER.
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Motley Fool contributor Rosemary Steinfort has no position in any of the stocks mentioned. The Motley Fool Australia owns shares of WiseTech Global. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.
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